Malta’s corruption is not just in the heart of government, it’s the entire body

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Alexander Clapp –  The Guardian

Only now, two years after Daphne Caruana Galizia’s murder, is it becoming clear just how rotten the state really is

A protest in Valletta on 1 December demanding that Joseph Muscat step down. Photograph: AP

Malta is notorious for its corruption. For decades, a pair of political machines – the Labour and Nationalist parties – have operated with impunity on the island. But in 2013 the corruption went into overdrive.

After 15 years out of power, the Labour party took office, and within months, public assets were being sold off to Azerbaijan. The new government also licensed a collection of financial laundromats masquerading as banks, just as the island became a haven for ever greater flows of dirty cash, and people shuttled their own fortunes away to offshore holdings in Panama and Dubai.

One person was watching obsessively, however. Daphne Caruana Galizia was Malta’s most dogged journalist. For years, her blog, Running Commentary, put these scandals on full display for everyone on the island to see, exposing the underlying rot in Malta’s supposed prosperity. Caruana Galizia’s courage led to her assassination in October 2017, killed by a car bomb. It put her alongside Hrant Dink in Turkey and Anna Politkovskaya in Russia – journalists murdered for exposing corruption, only this time near the heart of Europe in a state that continued to pass itself off as a success story.

For two years now almost everyone on Malta has been demanding to know who ordered Caruana Galizia’s murder – though the Labour party she routinely excoriated has shown scant interest in pursuing the case. It treated her assassination as an inconvenience – why do foreigners keep asking about this? – and an opportunity: it became a chance to discredit the journalist’s allegations now that she was no longer around to defend them. Visiting Valletta in early 2018, I watched as public sector workers were sent every morning to a shrine to Caruana Galizia to sweep away the previous night’s assemblage of flowers and posters in her honour: “You killed Daphne to escape jail!” signs said. “Daphne was right!” When I attempted to interview the prime minister, Joseph Muscat, his press secretary told me it could only happen on two conditions: I could not ask about financial corruption or about Caruana Galizia.

For months, the three men accused of planting and detonating the fatal car bomb would not so much as utter their names aloud to a judge. All three have pleaded not guilty. But last year one did start talking: he explained that he’d been recruited to kill Caruana Galizia by a taxi driver offering €150,000. This taxi driver, Melvin Theuma, was eventually arrested in mid-November, and when questioned, accused a prominent Maltese casino magnate, Yorgen Fenech, of hiring him to arrange the killing. Theuma was subsequently given a presidential pardon.

Fenech, meanwhile, pointed to the complicity, if not outright participation, of the highest levels of the state. He was not just a shadowy businessman – Fenech was also heavily involved in Labour’s financial schemes. Shortly after taking office, Konrad Mizzi, the tourism minister – who had been named in the Panama Papers – and Keith Schembri, Muscat’s chief of staff, had set up two Panamanian companies that had connections to a Dubai trust, which was alleged to be owned by Fenech.

Fenech has now been charged with conspiracy to murder – he has pleaded not guilty. Fenech also sought a presidential pardon but it was declined. But in the past week his revelations prompted new speculation, as he attempted to implicate Schembri as a co-conspirator in the murder plot. Schembri was questioned and then released by police; he denies all allegations against him.

The prime minister Muscat has been increasingly embattled, denying one allegation after the next. In the past month he has taken it upon himself to become Malta’s police chief and national spokesman. He has handed out certain presidential pardons, while mysteriously withholding others. It was difficult enough to imagine Valletta running a credible investigation into Caruana Galizia’s death using a judiciary and police force lined with Muscat’s partisans. Now the game is downright rigged. Initial reports claimed that the prime minister was resigning from office. This is not strictly true: he has said he will remain in power until Labour elects a new leader in January, potentially giving him time to lay the foundations for the exoneration of anyone around him who is connected to the case.

But at play is a deeper problem – something Caruana Galizia grasped more acutely than anyone. So concentrated was Labour’s corruption, it is unthinkable that anyone involved doesn’t possess compromising information on others in the party. Perhaps this prevents people in the party from turning on each other – or maybe it becomes a form of mutually assured destruction, with the testimony of any witness heralding the collapse of the whole cabal.

Where does this lead? There is little talk in Valletta – or Brussels – of actually dismantling the rogue financialisation of the island or halting the open flows of suspect capital – abetted by a porous banking structure and tax incentives that elevated foreign corporations over Maltese citizens. Brussels has still never solved how to integrate certain “small states” in the wider European project – Liechtenstein, Luxembourg, Monaco, Malta. They exist either as secretive finance hubs or homes of reactionary forms of rule – or, in Malta’s case, a bit of both. The island now stands as a test case for whether the EU can ever successfully incorporate such a state – one that, until recently, had a robust working class – or whether these countries are bound to remain the problem children of the continent forever.

And after all that Malta has endured in the past two years, it is hard to imagine a worse fate for the country than to simply revert to the same rotten and discredited two-party system of rule. The question for its citizens, once they get answers to those surrounding Caruana Galizia’s murder, is what they might ever hope to put in its place.

  • Alexander Clapp is a journalist based in Athens

 

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